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Gold/Mining/Energy : Companhia Vale Do Rio Doce (RIO)
VALE 12.09+1.7%Oct 31 9:30 AM EST
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From: JakeStraw3/23/2010 3:36:03 PM
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We have a 12 month ADR share price target of $42, which at the time of this interview would imply a gain of more than 30% over the current price. In addition, we own call options on the stock.

Vale is the largest diversified mining company in the Americas and the second largest metals and mining company in the world, with a presence in 30 countries and a market capitalization of around $150 billion. It is also the largest producer and exporter of iron ore and pellets, which comprises around 70% of gross revenue but over 90% of its EBITDA. The remaining nonferrous division, primarily nickel, copper, potash, coal and aluminum products account for roughly 8-10% of the remaining EBITDA.

Vale is also the largest logistics company in Brazil. Due to the frequent remoteness of mines and energy intensive nature of mining, Vale has invested in hydroelectric dam projects such as the Belo Monte hydroelectric dam project. In total, Vale owns stakes in eight hydro dams in Brazil and Indonesia with roughly 2,500 total megawatt capacities. The company also owns its own transportation networks, ports and processing plants and is strategically growing this side of the business in ways that provide for a very compelling growth story.
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